Standard Chartered to issue $1B in securities in Hong Kong after supporting Chinese security law

June 18, 2020.

will issue $1 billion in securities next Friday on the Hong Kong stock exchange, the British bank revealed on Thursday, signaling its commitment to the Hong Kong market even after it has faced criticism for supporting a controversial Chinese law.

The bank, which does the vast majority of its business in Asia, Africa and the Middle East, came under fire two weeks ago for publicly supporting China’s imposition of a stringent national security law on Hong Kong that critics say will erode the city’s autonomy. Yet investors have not shied away from Standard Chartered shares, with the bank’s stock remaining relatively stable since the announcement. 

The bank, which has $720 billion in assets, said it plans to raise the money for general business purposes and to strengthen the bank’s regulatory capital base. It is part of an ongoing, yearslong series of debt issuances worth $77.5 billion. 

After the fixed-rate resetting perpetual subordinated contingent convertible securities are issued on June 26, they will pay 6% yearly interest until they mature in 2026. 

Standard Chartered’s primary listing is on the London Stock Exchange, but it maintains secondary listings on the Hong Kong stock exchange and the National Stock Exchange of India. 

Earlier in June, after Standard Chartered and both announced support of China’s national security law, high-profile investors, including U.K. asset management firm Aviva, condemned the banks’ decisions. 

Standard Chartered and HSBC are headquartered in London, but both banks maintain huge footprints in Hong Kong, a financial hub linking China with Western markets. Hong Kong officials have encouraged the banks to relocate to the city for years, a proposition that may look more appealing now given growing British hostility to the institutions' support of the national security law. 

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